Net Profit and Revenue of Oi Wah Increases 1.2% and 3.6% Respectively in FP2018; Will Continue to Expand Cautiously and Remain a Healthy Risk Level

Financial Highlights


            6 months ended 31 August









Profit before taxation




Profit attributable to shareholders of the Company




Earnings per share (HK cents)




Interim dividend (HK cents)





HONG KONG, CHINA - Media OutReach - 30 October 2017 - The board of directors of Oi Wah Pawnshop Credit Holdings Limited (HKSE: 1319, the "Group" or "Oi Wah") announced its interim results and its financial position. For the six months ended 31 August 2017 ("FP2018"), profit attributable to shareholders of the Company has increased by 1.2% and reached approximately HK$54.4 million (six months ended 31 August 2016 ("FP2017"): approximately HK$53.8 million).


In FP2018, the Group recorded revenue of approximately HK$110.5 million (FP2017: approximately HK$106.6 million), representing an increase of approximately 3.6%, which mainly due to the continuous expansion of our mortgage loan portfolio in FP2018.


During the period, earnings per share was HK2.5 cents (FP2017: HK2.5 cents). The Board of Directors recommends an interim dividend of HK$0.78 cents.

Business Review


Mortgage loan business

For the six months ended 31 August 2017, the mortgage loan business remained a major source of income of the Group. During the period, the interest income increased by approximately or 6.5% from approximately HK$72.7 million for the six months ended 31 August 2016 to approximately HK$77.4 million for the six months ended 31 August 2017, which was mainly due to the increase of average month end balance for the gross mortgage loans receivables from March to August with total new mortgage loans granted of approximately HK$432.4 million during FP2018.


In FP2018, the Company was committed to improve the mortgage loan portfolio of the Group. During FY2018, the loan-to-value ratio for first mortgage decreased by approximately 2.9% to approximately 48.4%, while the overall loan-to-value ratio for subordinary mortgage decreased by approximately 2.0% to approximately 54.0%, of which, loan-to-value ratio of subordinate mortgage that the Group participated in increased by approximately 1.3% to approximately 20.1%.


Furthermore, the management are doing their best to attract high quality customers during FP2018, resulting in a substantial improvement in minimising the occurence of overdue issues. The mortgage loan receivables that were past due for one month or more decreased from approximately HK$48.9 million as at 28 February 2017 (which is approximately 4.25% of the mortgage loan portfolio of the Group) to approximately HK$10.5 million as at 31 August 2017 (which is approximately 0.92% of the mortgage loan portfolio of the Group), representing a decrease of approximately 78.5%.


Pawn Loan Business

During FP2018, pawn loan business remains steady and revenue from that reached HK$33.1 million, with HK$30.0 million interest income from pawn loan receivables and HK$3.1 million from gain on disposal. Average loan amount reached approximately HK$6,200 per transaction (FP2017: HK$6,100 per transaction) with the aggregate new loan amount slightly decreased by 7.8% to HK$278.1 million (FP2017: HK$300.9 million).


During the period, the luxurious market has seen a rebound and the Group is confident of the demand for the pawn loan business. The Group will continue to channel resources to advertising and promotion to enhance the Group's brand awareness.



In FP2018, the Group adopted a cautious and prudent approach when granting loans by increasing the proportion of first mortgage loans in the Group's portfolio and maintaining its focus on high net worth customers, in order to remain a healthy risk level.

Looking forward, with the potential impact of the Fed's balance sheet reduction and further US rate hikes, as well as housing policies outlined in "The Chief Executive's 2017 Policy Address", such as the "Starter Homes" scheme, increase supply of units under the Green Form Subsidised Home Ownership Scheme (GSH) and the Interim Scheme of Extending the Home Ownership Scheme (HOS), the Group is of the view that the Hong Kong property market remains unpredictable.


Meanwhile, the Directors are aware that peers are actively diversifying their lending business such as granting private loans and providing online money lending services. However, in response to the uncertainties of the local property market and the global economy, the Group will maintain its focus on secured loans to ensure effective risk management.


In regard to the pawn loan business, the Board is of the view that luxurious goods market has bottomed and that its pawn loan business will remain stable. The Group will actively diversify its collaterals to other luxurious items, such as automobiles and yachts, and will continue to broaden its customer base.


About Oi Wah Pawnshop Credit Holdings Limited

Oi Wah is a financing service provider in Hong Kong, mainly providing secured financing, including pawn loans and mortgage loans. According to the Ipsos Report, Oi Wah is the largest pawn loan service provider in Hong Kong in 2011 in terms of loan amount granted and number of pawnshops, and has been constantly growing since. The Group established its first pawnshop in 1975 and currently owns 11 pawnshops in various locations in Hong Kong. Oi Wah diversified into mortgage loan business in 2009. 

The issuer is solely responsible for the content of this announcement.

Oi Wah Pawnshop Credit Holdings Limited




30 Oct 2017

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